Discount rates generally fall under three categories: qualified, mid-qualified, and non-qualified.

Qualified Rate:

This rate generally applies to card-present transactions and has the lowest discount rate.

Mid-Qualified Rate:

This rate is higher than the qualified rate due to higher risk since the card is not present. It generally applies to phone, fax, mail order, and Internet transactions.

Non-Qualified Rate:

This rate generally applies to business, corporate, foreign, rewards card, and transactions that do not meet the Visa/MasterCard requirements for qualified and mid-qualified transactions. This encounters the highest discount rate of the three.